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Activity-Based Product Costing Davis Company produces two hair dryers: regular and deluxe. The company has four activities: machining, engineering, receiving, and inspection. Information on
Activity-Based Product Costing Davis Company produces two hair dryers: regular and deluxe. The company has four activities: machining, engineering, receiving, and inspection. Information on these activities and their drivers is given below. Regular Deluxe Total Units produced 80,000 240,000 Prime costs $6,560,000 $28,320,000 $34,880,000 Machine hours 80,000 400,000 480,000 Engineering hours 200 1,800 2,000 Receiving orders 300 900 1,200 Inspection hours 800 1,600 2,400 Overhead costs: Machining $7,200,000 Engineering 800,000 Receiving 336,000 Inspecting products 432,000
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